In Monopoly, we all dread getting the card that reads “go to jail.” But as far as Wall Street goes, investors, peculiarly enough, maybe ought to hope that their company CEOs go to jail. The reason: a trip to the clink is turning out in some instances to be a big plus for the stocks.

Let’s take a couple of recent cases, kicking off with Martha Stewart, the former CEO of Martha Stewart Living Omnimedia, who was sentenced to five months behind bars last July 16 for lying about a securities trade (involving biotech ImClone Systems). Since then, the shares of MSOL – about 30 million of which are owned by Stewart – have shot up more than 125%.

The latest spurt in the stock, a one day jump of 6.3%, came last Wednesday on news of the $11 billion merger between Kmart and Sears. With Martha Stewart products already sold in Kmart stores, the merger sparked speculation that products sporting her name might also be sold in Sears stores throughout America. Based on the spurt, the market value of the shares of Martha Stewart Living Omnimedia rose about $55 million, while Ms. Stewart’s stake racked up a one-day paper gain of $33 million, far more than the paltry pay she earns for performing her menial chores in jail.

Meanwhile, her company’s shareholders, who initially suffered badly on the news of her problems with the law, are undoubtedly singing their jailbird’s praises once again, what with the stock having nearly doubled from its 2003 close of $9.85 to Friday’s wrap-up of $18.78.That’s a jump in market capitalization of almost $500 million.

Yet another example of a prison stay leading to a peppier stock price involves Stewart’s close buddy, Sam Waksal, the former CEO of ImClone. He was sentenced last June to 7 years and 3 months of jail time on charges of illegal insider trading and fraud related to his attempts to sell ImClone shares after he learned that the Food & Drug Administration would reject an application for the company’s cancer drug, Erbitux.

In recent years, Waksal owned or had options on 4.5 million ImClone shares ,or 6.6% of the outstanding stock. That stake, though, has since been reduced, the extent of which is unclear. But here again, ImClone’s shares are rebounding somewhat while Waksal is incarcerated. Though having plunged from their 52-week high of $87.24 to a low of $33.50 following the Erbitux fiasco and the insider trading scandal, the shares have since recovered some of their loss, climbing 36% to Friday’s close of $44.43.That’s an increase in shareholder value of almost $1 billion.

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RUNOFF…

* The Securities and Exchange Commission, I’ve learned, has opened a trading investigation into the shares of VioQuest Pharmaceuticals (formerly Chiral Quest), an over-the-counter biotech company traded on the Bulletin Board that develops chemical catalysts and technology used by pharmaceutical and chemical companies to synthesize isomers of chemical molecules. Brokerage firms that traded in the shares have recently received requests for the identities of their clients.

* The SEC is also said to be making inquiries about the head of a reasonably well-known financial public relations firm who is believed to have actively traded in and out of his client’s shares ahead of market-influencing news.

* Latest equity mutual fund inflows show the public is turning hotter on stocks, having snapped up $5 billion worth of funds in the past week, the highest in 7 months and up from $3 billion the week before, according to liquidity tracker Charles Biderman ofTrimTabs.Com., an online West Coast Institutional service.

* The price of Federal Funds contracts suggests to Legg Mason’s chief fixed-income strategist, Sharon Stark, that there’s an 84% chance of another interest rate hike in December.

* An investment advisor of some notoriety is openly critical of a prominent financial journalist who, he claims, is giving a Northeastern money manager repeated favorable publicity without disclosing she personally owns the fund’s shares.

* Prudential Securities’ technical analysis chief Ralph Acampora sees gold – which closed Friday at $446.50 an ounce, up $3 – stubbornly holding to its uptrend. Gold closed last year at $415.

* Amazon.com got pounded Friday with a sell rating from Bank of America Securities’ analyst Aram Rubinson, who contends Wall Street is too optimistic on its growth prospects and operating leverage. He recommends sale of the stock – which closed at $38.55, down 4.5% – and predicts about a 38% decline to $26.